Goldman and Ashmore jointly developed the product’s principal protection structure called variable proportion portfolio protection (VPPP), which is a new twist on constant proportion portfolio insurance (CPPI). According to Jerome Booth, head of research at Ashmore, VPPP is more flexible and better suited for an asset class like emerging markets – which can be highly volatile – and his firm’s active management style.

“From Ashmore’s point-of-view, this is a great way to raise assets from new investors,” says Booth.

So far, Goldman and Ashmore have sold $500 million of the new product mainly to Asian clients, insurance companies and institutional investors. Booth expects to sell more to investors who have avoided emerging market debt or have had a small allocation to the asset class in the past. These investors could be attracted by the principal protected format, which will guard them from market volatility.

This white paper looks at the Basel Committee's BCBS239 principles, also known as PERDARR (Principles for Effective Risk Data Aggregation and Risk Reporting), which comes into force from 1 January 2016.

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US insurer MetLife is fighting its designation as a systemically important financial institution - a label handed out by the FSOC in December. State supervisors are also questioning the decision: www.risk.net/2391615. Should MetLife be supervised as a Sifi?